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European Commission challenged over the Polish electricity capacity market’s addiction to coal

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Category: Press Releases

Published: 15 March 2019

Tempus Energy yesterday took the European Commission to Court for approving the Polish electricity capacity market which favours fossil fuel generation at the expense of clean energy technologies.

Building on a recent EU Court ruling that resulted in the suspension of the UK’s capacity market, Tempus Energy has yesterday launched a case against the European Commission’s approval of the Polish Capacity Mechanism on the basis that it unfairly favours fossil fuel generation at the expense of clean alternatives, such as demand side response [1].

Capacity mechanisms, which are intended to ensure the security of supply, are estimated to add almost 58 billion euros to energy bills across the European Union for questionable benefit, and loopholes in new rules agreed by EU legislators could see some coal plants receive public subsidies until the late 2030’s [2]. This would apply not only to the Polish plants, but also to polluting plants in other EU Member States, such as Greece that is currently negotiating its new capacity mechanism.

The European Commission approved the Polish capacity market last year, and in its first auction the government awarded 22,4 GW with capacity payments, out of which 80% benefited coal and lignite power plants, which will be able to receive public subsidies via up to 15-year long contracts.

In reaction to the case launched against the European Commission today, Joanna Flisowska, Coal Policy Coordinator at Climate Action Network (CAN) Europe said:

“To date the vast majority of Polish capacity contracts have gone to coal power plants, allowing them to receive public subsidies until the late 2030’s, while coal has to be phased out by 2030 at the latest if the EU is serious about achieving the Paris Agreement goals. Coal companies should not be given unfair advantage, particularly when human health and our ability to address dangerous climate change is at stake.”

“The Polish case is yet another example of how capacity mechanisms are abused to subsidise coal with public money. There’s no time to waste and the European Commission must carefully scrutinise capacity mechanisms to ensure they align with the EU’s climate objectives.”

Climate Action Network (CAN) Europe is Europe's leading NGO coalition fighting dangerous climate change. With over 150 member organisations from 35 European countries, representing over 1.700 NGOs and more than 40 million citizens, CAN Europe promotes sustainable climate, energy and development policies throughout Europe.